It seems that investors are actually paying more right now for Cogent stock than 3M is actually offering, meaning they’d lose money if the 3M deal went through. That’s some interesting Wall Street gambling.

Where’s the thought coming from?

The deal values Cogent at about 8.5 times 2010 expected Ebitda and 7.1 times 2011 estimates. Raymond James & Associates Inc. analyst Brian Gesuale notes that Cogent rival L-1 Identity Solutions Inc. (NYSE:ID), which put itself on the block earlier this year and could announce a deal in the coming days, is trading at 11 times its expected 2011 Ebitda, leading Gesuale to believe that either L-1 is overpriced or that the 3M offer undervalues Cogent.

Could be the former, though, right? L-1’s stock price is at least somewhat inflated by the idea that it’s for sale.

“At first blush, 3M’s offer appears light given the range of public takeout multiples in the government technology space this year at 9-14x forward EV/Ebitda,” Gesuale wrote in a note to investors. “The firm’s proprietary technology, leadership status in a growing [automated fingerprint identification] industry with high barriers to entry, and recent list of wins leads us to believe a higher acceptable takeout price is warranted.”

I guess that makes sense, but isn’t it also true that DHS represents a huge portion of Cogent’s business and that they’re not going to go on buying fingerprint readers forever?

So, who are these potential suitors?

The article mentions L-3 Communications Holdings Inc., Northrop Grumman Corp., SAIC Inc., and Honeywell. Not sure why they didn’t just throw Boeing and Lockheed in there, since they’re basically just listing big companies that work with the government and could afford Cogent. I would be kind of shocked if Honeywell went in that direction, since Cogent professes in its SEC statements that just about all of its business is in government and law enforcement, and Honeywell doesn’t play there all that much, but maybe they’d see it as a way to get further into the government market.

I certainly wouldn’t mind a little bidding war. It would make things more interesting, anyway.

P.s.: Just noticed that 3M is gobbling up other companies, too. PeHub has 3M buying a people-monitoring firm from Israel, Attenti Holdings, as well, for $230 million. I guess when you’re sitting on $5 billion in cash, you can do some shopping.